Connect with us

Economy

GM cuts jobs in response to present costs, future innovation

Published

on

GM cuts jobs in response to present costs future innovation

DETROIT (AP) — Even though unemployment is low, the economy is growing and U.S. auto sales are near historic highs, General Motors is cutting thousands of jobs in a major restructuring aimed at generating cash to spend on innovation.

It’s the new reality for automakers that are faced with the present cost of designing gas-powered cars and trucks that appeal to buyers now while at the same time preparing for a future world of electric and autonomous vehicles.

GM announced Monday that it will cut as many as 14,000 workers in North America and put five plants up for possible closure as it abandons many of its car models and restructures to focus more on autonomous and electric vehicles.

CEO Mary Barra said as cars and trucks become more complex, GM will need more computer coders but fewer engineers who work on internal combustion engines.

“The vehicle has become much more software-oriented” with millions of lines of code, she said. “We still need many technical resources in the company.”

The reductions could amount to as much as 8 percent of GM’s global workforce of 180,000 employees.

The restructuring also reflects changing North American auto markets as manufacturers continue to shift away from cars toward SUVs and trucks. In October, almost 65 percent of new vehicles sold in the U.S. were trucks or SUVs. That figure was about 50 percent cars just five years ago.

GM is shedding cars largely because it doesn’t make money on them, Citi analyst Itay Michaeli wrote in a note to investors.

“We estimate sedans operate at a significant loss, hence the need for classic restructuring,” he wrote.

The reduction includes about 8,000 white-collar employees, or 15 percent of GM’s North American white-collar workforce. Some will take buyouts while others will be laid off.

At the factories, around 3,300 blue-collar workers could lose jobs in the U.S. and another 2,600 in Canada, but some U.S. workers could transfer to truck or SUV factories that are increasing production. The cuts mark GM’s first major downsizing since shedding thousands of jobs in the Great Recession.

The company also said it will stop operating two additional factories outside North America by the end of next year.

The move to make GM get leaner before the next downturn likely will be followed by Ford Motor Co., which also has struggled to keep one foot in the present and another in an ambiguous future of new mobility. Ford has been slower to react, but says it will lay off an unspecified number of white-collar workers as it exits much of the car market in favor of trucks and SUVs, some of them powered by batteries.

The GM layoffs come amid the backdrop of a trade wars between the U.S., China and Europe that likely will lead to higher prices for imported vehicles and those exported from the U.S. Barra said the company faces challenges from tariffs but she did not directly link the layoffs to them.

GM doesn’t foresee an economic downturn and is making the cuts “to get in front of it while the company is strong and while the economy is strong,” Barra told reporters.

Factories that could be closed include assembly plants in Detroit and Oshawa, Ontario, and Lordstown, Ohio, as well as transmission plants in Warren, Michigan, and near Baltimore.

The announcement worried GM workers who could lose their jobs.

“I don’t know how I’m going to feed my family,” Matt Smith, a worker at the Ontario factory, said Monday outside the plant’s south gate, where workers blocked trucks from entering or leaving. “It’s hard. It’s horrible.” Smith’s wife also works at the plant. The couple has an 11-month-old at home.

Workers at the Ontario plant walked off the job Monday but were expected to return Tuesday.

After the morning announcement, Barra headed for Washington to speak with White House economic adviser Larry Kudlow in what was described as a previously scheduled meeting.

President Donald Trump, who has made bringing back auto jobs a big part of his appeal to Ohio and other Great Lakes states that are crucial to his re-election, said his administration and lawmakers are exerting “a lot of pressure” on GM.

Trump said he was being tough on Barra, telling the company that the U.S. has done a lot for GM and that if its cars aren’t selling, the company needs to produce ones that will.

At a rally near GM’s Lordstown, Ohio, plant last summer, Trump told people not to sell their homes because the jobs are “all coming back.”

Most of the factories to be affected by GM’s restructuring build cars that will not be sold in the U.S. after next year. They could close or they could get different vehicles to build. Their futures will be part of contract talks with the United Auto Workers union next year.

The Detroit-based union has already condemned GM’s actions and threatened to fight them “through every legal, contractual and collective bargaining avenue open to our membership.”

Bobbi Marsh, who has worked assembling the Chevrolet Cruze compact car at the Ohio plant since 2008, said she can’t understand why the factory might close given the strong economy.

“I can’t believe our president would allow this to happen,” she said Monday. Democratic Sen. Sherrod Brown said the move will be disastrous for the region around Youngstown, Ohio, east of Cleveland, where GM is one of the area’s few remaining industrial anchors.

“GM received record tax breaks as a result of the GOP’s tax bill last year, and has eliminated jobs instead of using that tax windfall to invest in American workers,” he said in a statement.

GM, the nation’s largest automaker, will stop producing cars and transmissions at the plants through 2019. In all, six car models were scrapped, leaving the company with nine remaining car models for its four brands, Buick, Cadillac, Chevrolet and GMC.

Among the cars that won’t be made after next year is the Chevrolet Volt rechargeable gas-electric hybrid. When introduced a decade ago, the Volt was meant to be a bridge to fully electric cars, the company said. It has a small battery that can take it about 50 miles, then it switches to a small gasoline engine.

But since it was introduced, battery technology has improved dramatically, GM said. Now the full-electric Chevrolet Bolt can go up to 238 miles on a single charge.

The United Auto Workers promised to fight any plant closures and criticized GM for cutting U.S. jobs while building full-size pickups in Mexico. It also recently announced that a new Chevrolet Blazer SUV will be built there. Also, GM imports the Buick Envision midsize SUV from China.

___

Associated Press writers Rob Gillies in Toronto, John Seewer in Toledo, Ohio, and Zeke Miller in Washington contributed to this report.

Advertisement
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Democrats

Stop underestimating the ignorance and gullibility of the left

Published

on

Stop underestimating the ignorance and gullibility of the left

As a conservative, I can break down the left vs. right paradigm by using two edited axioms. For the left, it’s “If at first you don’t succeed, double down and make it even worse.” For the right, it’s, “If it ain’t broke, do everything to keep the left from trying to fix it.”

I’m sure my friends on the left (few, but present) would disagree. I do what I can to keep and never completely alienate my progressive friends because I need them to help me understand why they react certain ways to different people, ideas, and circumstances. For example, a cordial conversation I had with a former Bernie supporter the other day revealed to me she still likes him, but she’s much more excited about Beto O’Rourke and Elizabeth Warren. I asked her opinion of Pete Buttigieg. She knew nothing about him.

Yesterday, she told me she was all in for Buttigieg. I asked why. She said he seemed more genuine than Beto and a better campaign strategist than Pocahontas (her choice of nicknames).

That’s the state of affairs in the Democratic Party. Every candidate has their share of faithful followers, but outside of Sanders’ and possibly O’Rourke’ most faithful, the game is wide open for most Democratic voters. They move their preferences up and down, left and right just as Republicans did during the early days of the 2016 primary season. In that regard, the left and right aren’t very different. At this stage, a lot of the popularity of the candidates will be based solely on personality. People like who they like and as long as they check the right ideological boxes, the early days are nothing more than a personality contest.

This is why every candidate is picking and choosing their policies to promote as well as the policies to avoid. You can tell when a candidate believes in a more moderate approach to handle any issue when they’re not willing to say much about it. When they’re radical on an issue, they blast it out there. This is the part that scares me.

Those who were paying attention in the late months of 2014 and the early months of 2015 know something that would probably shock most voters today. There was a topic the GOP wanted to avoid altogether. Strategists said not to bring it up. Analysts said it was a losing issue. Then, Donald Trump announced his intention to run and suddenly the taboo topic was front-and-center. That’s right, before Trump entered the race and gave his famous speech about deporting Mexicans, the GOP consensus stated that immigration was a topic to be avoided through the primaries and possibly onto the general election.

It’s important to understand this because it demonstrates very clearly how election season, especially primary season, sets the stage for not only the topics that will be discussed but also the way the country will be governed based on which side wins. It concerns me greatly that the topics being discussed by the Democrats today are Medicare-for-All, Green New Deal, reparations, higher minimum wages, eliminating student debt, and socialism in general. The presence of these radical ideas in the early days of the primary season tells us these are the topics that will be driven home by the eventual winner of the Democratic nominee.

If the Democrat then wins, they’ll be expected to start implementing these ideas just as President Trump was expected to repeal Obamacare and build the wall. He ran on those ideas, so he’s expected to deliver.

Republicans might think, “Bring it on.” I hear about it when talking to GOP strategists. I see it in the bluster of keyboard pundits on Twitter. I even see it in the posts and statements by the GOP itself. Most are licking their chops at the opportunity to take on these radical progressive ideas. Unfortunately, they’re not doing it right, and by “they” I mean I’ve seen a tiny handful who are even taking it seriously.

What we’re seeing instead is the complacency that goes with underestimating the ignorance and gullibility of the left as well as the malleability of the center. That friend who now supports Buttigieg happens to be a nurse and happens to adore the ideas of both the Green New Deal and especially Medicare-for-All. When one of my other friends (who happens to be a more moderate leftist) asked her the standard question of how they’re going to pay for it, the new Buttigieg fan said, “The rich will pay for it.”

I started to rain on her parade with actual numbers, but stopped immediately. This wasn’t the time to debate anything, let alone the idiocy of believing only the rich would be dramatically affected by such insane increases in the budget. After all, I need to keep some progressive friends around and this particular one would never have spoken about politics with me again if I shared the truth with her. I let it go.

It’s anecdotal, but I have a very strong feeling this thinking is common and growing more prevalent every day. This wasn’t a random reasoning. This is what they’re saying among the hyper-leftists in the Democratic Party. It seems every candidate has a variation of the “hose the rich” plan. They know very clearly that the numbers are far too large for the average American to stop and think about. There are sheep on both sides of the political aisle, but the numbers are going up dramatically on the left thanks to the sudden total disregard for fiscal responsibility that is now Kosher to the new Democrats.

And the people will follow. They won’t challenge them. They won’t question them. They won’t do the math. They’ll nod their heads in unison as these candidates promise exponentially more than Bill Clinton or Barack Obama ever had the gall to promise.

The fact that these socialistic ideas absolutely, positively cannot work will be ignored by the candidates as they fly over the heads of the leftist voters. I’m not saying they’re stupid. Many are quite bright. But anyone who believes socialism has any chance of success is willfully ignorant to the facts and gullible to the progressive sales pitch.

It is incumbent on conservatives to do everything we can to educate the population. If you’re as cynical as me, you’ll probably think it’s a nearly impossible task. If you’re as worried as me, you’ll know there’s nothing else we can do but try.

What we MUST NOT do is take jabs at the ideologies and policy proposals with an assumption the voters will get the jokes. Here’s Tweet tonight from the GOP:

As Tweets go, this one is horrible. Imagine a leftist or even a centrist leaning towards Medicare-for-All reading this. Government takeover of the healthcare system, single-payer, and elimination of private health insurance – to someone who doesn’t understand the numbers, this might seem like the GOP is endorsing Buttigieg because none of the negatives they pointed out are negatives in the minds of most leftists.

But it’s worse than that. This Tweet nor anything I’ve seen from the GOP so far on Twitter or elsewhere does anything to teach Republican voters how to counter arguments in favor of Medicare-for-All. Zero. The next election is going to be won or lost based on whether the GOP can demonstrate these “new” ideas are bad. And it won’t just be the candidates and pundits who need to do this. The voters themselves need to be able to make a solid case for why any one of these ideas are horrible.

The GOP needs to step up its game and attack the horrible leftist policy proposals with facts. Right now, it seems like they assume most Americans believe socialism is bad. Come election day, that may not be the case if the GOP doesn’t fix their messaging.

Continue Reading

Economy

PragerU: Is Denmark socialist?

Published

on

Is Denmark socialist

Not too long ago, many socialist, including presidential candidate Bernie Sanders, thought the model of the future for America was Venezuela. They saw the prosperity that the oil-rich nation was enjoying in its early days of socialism and said, “That’s us. That’s where America needs to be.”

Fast forward to today and suddenly every socialist is disavowing Venezuela altogether, claiming that the model of America was never really the model they thought it was and it’s not even real socialism. Why? Because it failed. Therefore, by the socialists’ reckoning, that must mean they didn’t do it right.

Now, Denmark is suddenly the model for America’s future. But there’s a problem. Denmark is a free-market nation that has been peeling away at its socialist foundation for decades. While they enjoy some of the most robust social programs in the world, they’re doing so at such a high price that the people are left with very little other than the essentials. Yes, they have free healthcare, but more citizens are turning to private insurance to bypass the poor treatment and long wait times associated with single-payer healthcare. Yes, they have free schooling, but grade-level students are being shifted to private schools at nearly a 20% pace while the “free” college system is being taken advantage of by those who are clever enough to realize they’re better off staying in college indefinitely than graduating and being thrown into the world of working to pay for the system.

This video by PragerU’s Otto Brons-Petersen breaks down the reality of the socialist utopia leftists often point to as their beacon of hope for a failed economic and political philosophy.

Continue Reading

Economy

Note to Nashville: Privatization is good, except when it’s idiotic

Published

on

Note to Nashville Privatization is good except when its idiotic

This will be the first and hopefully the last time I speak out against a government plan to privatize anything. But as much as I like a blanket approach to taking control away from government in the vast majority of situations, the plan to privatize public parking in Nashville is so loaded with problems, it shouldn’t move forward.

I first heard the details of the plan when I read about the rare occurrence of a Democratic mayor wanting to privatize an element of city government. Generally, Democrats push for more control over their territories, not less, which is why I was hoping to find an instance where the realities of limited-government federalism and capitalistic privatization was seeping into the psyche of a Democratic leader. What I found was appalling: a desperate mayor, David Briley, throwing anything he could against the fiscal walls in hopes of making it stick. His city faces a woeful budget shortfall, something that should not be happening in a city as vibrant and growing as Nashville.

But, they need money immediately to make up the shortfall before the end of the fiscal year and this seems to be their last resort following an atrocious set of attempts to sell off public land to make up the cash difference. The attempt was so botched, the city council passed a resolution preventing such an attempt from being used in the future to cover operating expenses. But now, they’re ready to push the parking privatization scheme through with a rubber stamp and hopes nobody will look closely at the details.

The latter is unlikely, as many are already speaking out. Mayoral candidate Carol M. Swain urged the city to halt the plans, clearly pointing out it’s a very bad deal:

Nashville must oppose Mayor David Briley’s public parking privatization plan

We the People of Davidson County and surrounding areas will be adversely impacted if Mayor Briley, who is up for re-election, can push through this deal that would entail a 30-year commitment.

No agreement of this magnitude should be for more than any one term of the mayor’s office.

Once they have the contract, there is nothing to prevent the bid-winning private company from also raising rates until they match rates common to larger cities such as Chicago and New York City.

As Swain noted, this is a 30-year deal that essentially turns a public revenue source into a for-profit scheme that will sacrifice the people’s control for decades in exchange for saving a single year’s budget. The loss of future revenues and control aren’t the only things at stake, though. The deal will include increases across the board for citizens of Nashville, including:

  • A rise in the number of parking spots designated as paid that will essentially double them over four years
  • Increased cost per hour by 25 cents
  • More than doubling fines from $11 to $25
  • Decreasing free parking times by four hours per weekday
  • Removing free parking on weekends
  • Removing free parking for green vehicles

The mayor is pushing the deal as a way to innovate and catch up with the rest of the nation, citing technological improvements. But any such improvements could be made by the city, as could the changes to the times, costs, and fines, so his points are moot. The reality is this: They need cash now and they don’t have any other schemes that can work this quickly.

There’s a solution to all this: cut budgets. Fiscal responsibility should not be obfuscated by get-cash-quick schemes that will harm Nashville’s citizens. Make cuts. Increase revenues long term. Make Nashville as business-friendly as possible. These are the ways that work in America. Corrupt land deals and desperate privatization schemes always hurt in the long run. This time, they’re hurting Nashville in the short term as well.

Nashville’s parking plan is the equivalent of taking an important part of many citizens’ daily lives and pawning it off to pay the city’s bills. They’re giving up 30 years of control to save a single year’s budget.

Boost This Post

Get this story in front of tens of thousands of patriots who need to see it. For every $30 you donate here, this story will be broadcast to an addition 7000 Americans or more. If you’d prefer to use PayPal, please email me at jdrucker@reagan.com and let me know which post you want boosted after you donate through PayPal.

Will you help revive the American Conservative Movement?

 


NOQ Report Needs Your Help

Continue Reading

Facebook

Trending

Copyright © 2019 NOQ Report